The Trump administration has taken the drive for health care price transparency a step further with the finalization of a new rule that will require health insurers and self-insured health plans to share details on pricing and cost-sharing.
The Transparency in Coverage rule builds on another highly publicized rule that will require hospitals to post their prices starting in January. Under the new rule, insurers and employer-sponsored health plans will be required to post in-network and out-of-network negotiated rates, “including an estimate of the individual’s cost-sharing liability for covered items or services furnished by a particular provider,” according to the rule. Grandfathered health plans will be exempt.
“President Trump is solving longstanding problems in our health care system; hidden health care prices have produced a dysfunctional system that serves special interests but leaves patients out in the cold,” CMS Administrator Seema Verma said in a statement. “Price transparency puts patients in control and forces competition on the basis of cost and quality, which can rein in the high cost of care. CMS’ action represents perhaps the most consequential health care reform in the last several decades.”
The new rule would go into effect on or after January 1, 2023, giving health insurers plenty of time to prepare for the list of requirements (or challenge it in the courts). The list includes creating online tools to help consumers understand out-of-pocket costs and negotiated rates for 500 “shoppable services,” expanding the list every year thereafter.
Healthcare Bluebook, whose experts were an active part of the policymaking, applauds the new rule. ” We believe this is an important win for consumers and employers and will help deliver a clearer picture of health care costs to support better decision making,” the company said in a statement. “ Our teams are already documenting potential additional requirements for our platform and developing a cost schedule and cost model.”
The news was also met with accolades from ERIC, the advocacy arm of ERISA. “The regulation comes not a minute too soon, as millions of Americans are struggling to pay inflated health care costs. Price transparency will empower patients to make more informed decisions while also driving competition among health care providers, reducing health care costs, and improving the quality of care,” James Gelfand, senior vice president of health policy, said in a statement.
According to the CMS, ” For the first time, most consumers will be able to get real-time and accurate estimates of their cost-sharing liability for health care items and services from different providers in real time, allowing them to both understand how costs for covered health care items and services are determined by their plan, and also shop and compare health care costs before receiving care.”
The rule also calls upon insurers to offer three different machine-readable files, addressing “ in-network provider negotiated rates, historical out-of-network allowed amounts, and drug pricing information.”
The rule also includes some good news for insurers: those who reward consumers for selecting lower-cost, higher-value providers will be allowed to deduct the amount of the savings passed on to the consumer when calculating their medical loss ratios,